Inside Asian Gaming

JUly 2015 inside asian gaming 29 already had enough Asian gaming punts. “We felt we could bring a very compelling package to Australian investors in the form of a gaming play in one of the emerging markets with the highest growth in the world.” Newly listed Donaco indicated Mr Lim and his younger brother Benjamin as controlling shareholders, mainly through a pair of Singapore investment companies, Convent Fine Ltd and Slim Twinkle Ltd. Joey and Benjamin Lim, who has a degree in international business and is individually a substantial shareholder in a Genting property development affiliate in Malaysia, are sons of Lim Tee Keong, who left Genting Group in the 1990s. Their father is an older brother of current Genting Group Chairman and CEO Lim Kok Thay, “There’s no formal connection, no cross shareholding, no financial investment by Genting [in Donaco],” Donaco Executive Director Ben Reichel says. “Our strategies are different as well in that Donaco is focused on these boutique properties, which can be very profitable if they’re in the right location, if they’re well managed, while Genting is focused on much bigger investments all around the world.” The family “is very close,” and Donaco and Genting officials “get on very well,” Mr Reichel says. “There have been some cases where people have gone to Genting looking for investment, and they’ve referred them to us, but there’s certainly no formal or financial involvement.” Donaco began in Singapore as a mobile technology provider—Joey Lim holds a degree in computer science—but the real prize was the opportunity to work with local Vietnamese officials in Lao Cai to develop a casino hotel on their border with China’s Yunnan province. the opportunity to work with local Vietnamese officials in Lao Cai to develop a casino hotel on their border with China’s Yunnan province. Lao Cai International Hotel, opened in early 2003, has since grown into Aristo International. Donaco remained largely under the radar for the next decade, through the death of Lim Goh Tong in 2007. In 2013, Donaco listed on ASX through a reverse takeover of Two Way Limited, a wagering technology business active in Australia and New Zealand. At the time, Mr Lim quashed speculation that Donaco was a vehicle for Genting to increase its stake in Echo Entertainment, Australia’s second largest casino operator. Mr Lim said his company considered listing in Singapore or Hong Kong but felt those markets plus a spa, karaoke bar, high-end restaurants, tennis court and golf driving range. The casino opened early this year and other facilities will be phased in over the next two years. Phoenix International’s gaming operations are strictly mass market with no junkets. That’s a marked contrast to Crowne International Club in Danang which relies on Macau junket operators for players. Danang’s large international airport, just seven kilometers from the casino, has four flights daily to/fromMacau, and junket promoters organize additional charters from mainland China. Other operators say the casino gets “significant” VIP business at its 56 tables, grown from an initial eight when it opened in 2010, plus 100 machines. The casino was built along with the separately run Crowne Plaza Danang, a four-star rated property with 535 beachfront rooms. “It is just not a true luxury resort casino,” Global Market Advisors Partner Andrew Klebanow says. “It is nice, but not the highest caliber property.” Vietnam also has about 20 slot clubs, restricted to five-star hotels by a 2013 government decree. Ho Chi Minh City has 12 slot clubs, mainly clustered in upscale District 1, where international business and hotels are also concentrated, with six in Hanoi. HCMC clubs feature up to 80 slot machine and electronic table seats, mainly in elegant surroundings. Appropriately upmarket table game play, in US dollars, starts at $10. Several clubs have VIP areas with $100 minimums and maximum bets up to $10,000. A knowledgeable source put Vietnam’s total 2013 gaming market at $275-300 million, half of it from slot clubs. That’s no small potatoes. Cover Story Vietnam also has about 20 slot clubs, restricted to five-star hotels by a 2013 government decree. Ho Chi Minh City has 12 slot clubs, mainly clustered in upscale District 1, where international business and hotels are also concentrated, with six in Hanoi.